Practical Tips to Avoid Problems with Florida Construction Lien Law

This article offers practical tips to help you navigate the Florida construction law and avoid common issues. Go ahead and start reading to make the most of these tips!

What You Need to Know About Florida Construction Lien Law?

Florida’s Construction Lien Law, detailed in Chapter 713 of the Florida Statutes, allows people who provide labor, materials, or services for a construction project to secure payment by placing a lien on the property. Here are the key elements you need to understand:

• Notice to Owner (NTO): The Notice to Owner form informs everyone designated on the project that you are providing labor, services or materials for the project and might file a lien if unpaid. It needs to be received within 45 days of starting work or delivering materials. The term, “Notice to Owner” can be confusing. A better description would be “preliminary notice,” because the document does not go only to the owner of the property but also to other designated recipients listed on the Notice of Commencement.

• Claim of Lien: If payment problems arise, the claim of lien must be recorded within 90 days of the last work done or materials delivered. It officially claims unpaid amounts.

• Lien Waivers: Lien Waivers waive lien rights upon receiving payment. It's crucial to handle them correctly to ensure they only waive what you intend.

Tips for Contractors and Subcontractors

1. Serve Notices Promptly

• Send the Notice to Owner (NTO) as soon as you start working. Delaying can risk your lien rights.

• Keep detailed records of all notices and confirm they've been received.

2. Keep Accurate Records

• Document all work done, materials supplied, and communications with the property owner.

• Ensure all contracts and changes are in writing and signed.

3. Monitor Payments

• Track payment schedules closely.

• Follow up on late payments quickly to avoid bigger issues.

4. Handle Lien Waivers Carefully

• Only give lien waivers after you've been fully paid for the work.

• Check waiver forms to make sure they don't waive more rights than you intend.

Tips for Property Owners

1. Choose Reliable Contractors

• Select contractors by checking their references, licenses, and past work.

• Make sure they understand Florida’s lien laws and their responsibilities.

2. Track Notices

• Keep organized records of all Notices to Owner you receive.

• Confirm that contractors and subcontractors are sending notices as required.

3. Manage Payments Wisely

• Use joint checks or conditional releases to ensure payments go to both contractors and subcontractors/suppliers.

• Hold off on final payments until you have lien waivers from everyone involved.

4. Verify Lien Waivers

• Make sure lien waivers are genuine and match the payments made.

• Consult a lawyer if you notice any discrepancies or have concerns.

Key Takeaway

Dealing with Florida’s Construction Lien Law can be complicated, but being proactive and organized can prevent many issues. By understanding the law, keeping thorough records, and following these practical tips, contractors and property owners can avoid common pitfalls. Good communication and documentation throughout your project will help prevent legal disputes and ensure smoother operations.  

If you find yourself facing issues, don't hesitate to reach out for guidance and support. SunRay can provide valuable assistance and expertise to help you navigate the complexities of construction payment disputes in Florida. Call 800-403-7660 today and get paid what you deserve!

Frequently Asked Questions

What happens if I miss the deadline to serve the Notice to Owner (NTO)?

Missing the NTO deadline means you may lose your lien rights, which could leave you without a legal means to secure payment for your work or materials.

How can I ensure my Claim of Lien is valid?

To ensure your Claim of Lien is valid, file it within 90 days of your last work or material delivery. Also, provide accurate and complete information, and consider consulting with a legal professional to avoid mistakes.

Are there any risks associated with lien waivers?

Yes, lien waivers can waive more rights than intended if not carefully reviewed. Always read and understand the terms of the waiver before signing, and ensure it only covers the payment received.

Can a property owner dispute a construction lien?

Yes, a property owner can dispute a lien if they believe it's invalid. They might argue that the lien was filed late, lacks proper documentation, or that the claimed amount is incorrect. Legal advice is often necessary in these situations.

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